Regulatory challenges and solutions: AIFMD II

How can an Alternative Investment Fund manager comply with the new AIFMD II requirements?


AIFMD II road to 2026: upcoming regulatory changes

In November 2021, the European Commission proposed a draft revision of the Alternative Investment Fund Managers Directive (AIFMD II). This revision aims at introducing new harmonised rules at the European Union (EU) level in different areas, such as

  • Loan-originating funds
  • Minimum substance of the asset manager
  • The use of Liquidity Management Tools (LMTs)

In November 2023, the Council of the EU and the EU Parliament reached an agreement on the final text of the omnibus directive modifying AIFMD and the UCITS Directive. The text is expected to be published in the EU Official Journal end of March 2024 and will enter into application in Q1 2026 after a two years period of transposition in nationals laws

How can Securities Services help AIFs?

As a European leader in asset servicing, and in particular depositary services and regulatory reporting services, we are best positioned to help managers of AIFs and UCITS to comply with AIFMD II.

Our local presence and expertise in key European jurisdictions and our large range of fund services make us your ideal partner to support you through AIFMD II new requirements.

New requirements under AIFMD II

Our solutions for AIFs

Liquidity management tools (LMTS)

Alternative Investment Fund Managers (AIFMs) who manage open-ended AIFs must select at least one Liquidity Management Tool to be used in exceptional cases such as:

  • Swing pricing
  • Anti-dilution levy
  • Notice periods
  • Redemption gates
  • We manage all the Liquidity Management Tools (LMTs) types required by AIFMD II
  • These services are available in all EU jurisdictions for UCITS and AIFs
  • Our LMT services are already compliant with local regulatory standards in France and other EU jurisdictions

Reporting requirements

AIFMD II introduces new reporting requirements for UCITS and includes new reporting obligations for AIFMs on their originated loan portfolios

  • Our regulatory reporting solutions already include data on loan originating for AIFs
  • We currently provide an AIFMD Annex IV reporting and monitor upcoming regulatory changes

Depositary services

AIFMD II clarifies that, when acting as a custodian, an Investor Central Securities Depository (CSD) is considered as a delegate of the depositary bank

  • We already consider Investor CSDs as our delegates, when we act as depositary of Alternative Investment Funds and UCITS
  • We were awarded as the Best Depositary Solution in 2020 (HFM European Hedge Fund Services Awards)

Loan originating funds

  • AIFs will be authorised to originate loans based on certain conditions
  • Our loan solutions help AIFMs to close their deals, monitor their loan portfolios and provide detailed reports.
  • This solution is fully embedded within a broader Private Debt offer, spanning across fund servicing and financing